Aker Solutions has agreed to acquire oil-services provider Reinertsen for nearly US$25million in a move to build on its position as a leading maintenance and modifications supplier offshore Norway.
Image from Aker Solutions.
The asset deal is set to close in Q2 2017, giving Aker Solutions ownership of Reinertsen's Norwegian oil and gas services business. The agreement excludes Reinertsen's liabilities as of 19 December 2016, when the company went into debt negotiation proceedings.
The deal is estimated to be about $25 million (NOK 212.5 million), and is subject to approval by the Norwegian competition authorities.
Reinertsen is the third-largest maintenance and modifications supplier offshore Norway with some 700 employees. Its main offices are in Trondheim and Bergen, where Aker Solutions also has a solid presence. The company's order backlog contains key maintenance and modifications contracts with Statoil, including a minimum six-year framework agreement awarded in December 2015. It also has some smaller subsea services and engineering contracts.
"Combining our capabilities will boost our presence in the Norwegian maintenance and modifications market, helping to safeguard core competencies at key locations and positioning us for a market recovery," says Luis Araujo, Aker Solutions CEO. "Our companies also have a history of collaborating offshore Norway that we will build on to the benefit of our customers."
The companies worked together from 2002 to 2010 on projects offshore Norway through the Aker Reinertsen joint venture. Reinertsen employees in Trondheim and Bergen will be moved to local Aker Solutions offices as part of synergies to be generated.
"We're glad to have found a new home for our oil and gas business after a very difficult time for our company," said Thomas Reinertsen, deputy CEO of Reinertsen.
Reinertsen had revenue of about $94 million (NOK 800 million) in 2016 and is expected to contribute positively to Aker Solutions' earnings from 2018.
"We welcome the Reinertsen employees to Aker Solutions and expect the integration of our two businesses to further strengthen our leading project execution," says Araujo. "While the global oil-services market remains challenging, we are seeing some signs of improvement, particularly in the brownfield segment."